Landmark deal marks another huge milestone for Adnoc Gas
- 19 Jul 2023
Adnoc Gas, a world-class integrated gas processing company, on Wednesday announced a 14-year supply agreement with Indian Oil Corporation Limited (IOCL) for the export of up to 1.2 million metric tonnes per annum (mmtpa) of liquefied natural gas (LNG) to India’s largest integrated and diversified energy company.
The agreement, valued in the range of $7 billion to $9 billion (Dhs25.7 to Dhs33 billion) over its 14-year term, signifies a major step forward in the partnership between the two industry leaders.
The landmark deal marks another significant milestone for Adnoc Gas as it expands its global reach, reinforcing its position as a global LNG export partner of choice, and reaffirming Indian Oil Corporation as its key strategic partner in the LNG market.
Commenting on the agreement, Ahmed Alebri, Chief Executive Officer of Adnoc Gas, said, “We are pleased to announce this long-term LNG sale, further strengthening the long-standing partnership with IOCL. We look forward to expanding our collaboration and take pride in the knowledge that Adnoc Gas’ LNG exports will further support the development of Indian Oil Corporation and contribute to India’s growth story.”
Under the terms of the agreement, Adnoc Gas will deliver up-to 1.2 mmtpa of LNG to IOCL in India. The deal serves as a testament to Adnoc Gas’ ability to meet the growing global demand for LNG, a critical fuel in the energy transition.
Meanwhile Adnoc Gas last week announced the award of $1.34 billion in contracts to Petrofac Emirates and the Consortium between National Petroleum Construction and C.A.T International for the expansion of its natural gas pipeline network.
Under the sales gas pipeline network enhancement (ESTIDAMA) programme, the new pipeline will extend Adnoc Gas’ existing pipeline network from approximately 3,200 kilometres (km) to over 3,500km, enabling the transportation of higher volumes of natural gas to customers in the Northern emirates of the UAE.
This strategic pipeline extension will drive further growth for Adnoc Gas as it continues to supply sustainable gas supplies in the UAE to support the company’s strategy to increase its market share and enhance its customer base.
Ahmed Mohamed Alebri, Chief Executive Officer of Adnoc Gas, said, “Our strategic network expansion will bring the advantages of lower-cost, sustainable and cleaner gas to more locations across the UAE by enhancing industrial access to natural gas, a cost-competitive and lower-carbon intensive fuel. The expanded pipeline will drive further growth for Adnoc Gas and our shareholders as we deliver on our mandate to achieve gas self-sufficiency for the UAE.”
As part of Adnoc’s highly successful In-Country Value (ICV) programme, which aims to enhance the UAE’s local value chain by encouraging local manufacturing and supporting local industries, over 70 per cent of the contracts’ value is expected to flow back into the UAE economy.
The ESTIDAMA programme comprises several packages, with the first one awarded in 2021 for early modification works on existing pipelines and completed in 2023. The second and third packages, which are being awarded now, include the construction of new pipelines and a gas compression plant in Habshan that will help deliver essential feed gas to key customers across the Emirates.
Adnoc’s integrated gas masterplan connects all parts of the UAE’s gas value chain, ensuring a sustainable and economical natural gas supply to meet local and international demand. The plan includes innovative approaches and technologies to increase gas recovery from existing fields and develop untapped resources.
Meanwhile Adnoc Distribution earlier announced the signing of an agreement with Hindustan Petroleum Corporation Limited (HPCL), one of India’s largest lubricant marketers and fuel retailing companies.
